Greetings, and welcome to The Simply Good Foods Company Fiscal Fourth Quarter 2023 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Mark Pogharian, Vice President, Investor Relations for Simply Good Foods Company. Thank you. You may begin.

Thank you, Operator. Good morning. I'm pleased to welcome you to The Simply Good Foods Company earnings call for the fiscal fourth quarter and full year ended August 26, 2023. Geoff Tanner, President and CEO; and Shaun Mara, CFO, will provide you with an overview of the results, which will then be followed by a Q&A session. The company issued its earnings release this morning at approximately 7:00 a.m. Eastern. A copy of the release and accompanying presentation are available under the Investors section of the company's website at www.thesimplygoodfoodscompany.com. This call is being webcast and an archive of today's remarks will also be available. During the course of today's call, management will make forward-looking statements that are subject to various risks and uncertainties that may cause actual results to differ materially. The company undertakes no obligation to update these statements based on subsequent events. A detailed list of such risks and uncertainties can be found in today's press release and the company's SEC filings. Note that on today's call, we will refer to certain non-GAAP financial measures that we believe will provide useful information for investors. Due to the company's asset-light strong cash flow business model, we evaluate our performance on an adjusted basis as it relates to EBITDA and diluted EPS. We have included a detailed reconciliation from GAAP to adjusted items in today's press release. We believe these adjusted measures are a key indicator of the underlying performance of the business. The presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Please refer to today's press release for a reconciliation of the non-GAAP financial measures to the most comparable measures prepared in accordance with GAAP. With that, I'll now turn the call over to Geoff Tanner.

Thank you, Mark. Good morning. Thank you for joining us. Today, I will recap Simply Good Foods' financial results and the performance of our brands. Then Shaun will discuss our financial results in more detail before we wrap it up with a discussion of our fiscal 2024 outlook and take your questions. We ended the year with strong Q4 net sales growth of about 17%. As expected, net sales outpaced retail takeaway due to the retail customer drawdown last year. Gross margin was slightly greater than our expectations, primarily due to lower supply chain costs. Full year fiscal 2023 organic net sales increased nearly 7%. This performance reflects our diversified portfolio across brands, retail channels, customers and product forms. We believe we exited the year with trade inventory at normal levels. Gross margin improved during the year, and we expect to build on this momentum in fiscal 2024. In my nearly 7 months tenure at the company, I'm even more convinced of the long-term growth outlook of the nutritional snacking category and our business. Category growth in Q4 and the year was 15% and 17%, respectively. With low household penetration of about 50% versus legacy U.S. snacks at 90% plus, coupled with the twin tailwinds of snacking and health and well, we believe the category will continue to maintain its multiyear growth trajectory and outperform U.S. packaged foods and snacks. As the preeminent category leader and category adviser for the majority of our customers, we will continue to invest in our brands and partner with retailers to accelerate category growth. I think over time this category will be twice its current size. I don't have the exact sequence of pacing that the opportunity is there. Total Simply Good Foods combined measured and unmeasured channel U.S. retail takeaway broke in Q4…

Thank you, Geoff, and good morning, everyone. I will begin with an overview of our net sales. Total Simply Good Foods fourth quarter net sales of $320.4 million increased 16.9% versus the year-ago period. Looking at the Q4 drivers of growth, net price realization was about 3.5 percentage points and volume was about 13.4%. As Geoff stated earlier, net sales growth outpaced retail takeaway. At the bottom of this slide, we have to reconcile Q4 POS of 11% to Q4 North America net sales growth of 17%. The biggest driver is in the prior year period, to the retail customer inventory draw down last year. As we've discussed throughout the year, in fiscal 2022, retailers increased their inventory levels to address supply chain challenges and depleted this inventory in Q4 of fiscal 2022, which is atypical. This year, we returned to a more normalized pattern, where retailers built a week or 2 of inventory in the first half of the year and depleted the majority of it in Q3 with minimal change in Q4. Full year net sales of $1.24 billion increased 6.3% versus the year ago period. As we exited fiscal year 2021 and 2022, inventory at retail moved around due to supply chain issues. However, as we exit 2023, we believe we ended the year with more normal retail inventory levels. Therefore, in fiscal 2024, we anticipate for full year net sales and retail takeaway growth will be largely in line. Moving on to other P&L items for Q4. Gross profit was $120.5 million, an increase of $18.6 million from the year ago period, resulting in gross margin of 37.6%. The 50 basis point increase versus the year ago period was primarily due to lower ingredient packaging costs. Adjusted EBITDA was $67.3 million, an increase of $16.3 million…

[Operator Instructions] Our first question comes from the line of John Baumgartner with Mizuho Securities. Please proceed with your question.

Geoff, I wanted to ask about the skeptics associated with the Atkins brand. How many of them are buying other brands in the category relative to how many would be incremental? And of the folks buying other brands, do you have a sense as to whether they're buying other weight management brands or more high-protein active nutrition brands. I'm trying to think through this and understand how much of this pool of skeptics as you pursue them requires winning more of a market share gain and dislodging consumers relative to how much would be contingent on growing the category and how that impacts your engagement?

I hope you like the new advertising. When we were looking at Atkins, so we took a step back. And what we really heard loud and clear through the research is that Atkins is one of the best positioned brands out there focused on weight management. What we heard loud and clear is that 80% of consumers want to lose or maintain weight and Atkins is seen as the trusted leader in low carb no sugar solution. So we see nothing but tremendous potential for this brand. But and as we talked in the scripted remarks, we did hear that there's a group of consumers who are either a little confused about what Atkins is or don't fully understand the benefits that you can eat products this delicious and lose or maintain weight. And that's when we started zeroing in on this idea that there are some skeptics out there, which to us represent nothing but upside to the business. Because as you know, once we convert consumers, they become loyal very quickly and the buy rate is particularly high compared to most consumer products. So that was the goal with this new advertising is to firstly communicate Atkins is not a weight management plan. It's not a regimented weight loss program. We have a range of delicious products that can help consumers maintain or lose weight. And as I step back on the business in a fresh set of eyes, I see nothing but upside. If we can start to convert what might be very light consumers or non-consumers and start moving them down the funnel into loyal consumers with high buy rate. So that was the genesis for how we arrived at that marketing strategy. What we also found is the 2 new campaign also strongly resonates with loyal consumers because it's a little tip of the hat to them, who knew, I knew. So with this new campaign, what we found is we were talking and we were resonating both with our loyal consumers and with potential new consumers that we're going to move through the funnel.

And then just to follow up. When we think about the marketing initiatives for fiscal '24, it sounds like you've got a fair amount of non-price initiatives that are heading into the market. Do you have a sense -- maybe it's too early, but do you have a sense at this point, when you look across the competitive spectrum in the category, do you have a sense that your competitors are sort of also in market following in a similar way where they're leaning more on non-price promotion, more marketing more advertising, more in-store display as opposed to just deep price cuts in terms of funnelling back the upstream deflation in the market.

I think what separates Simply Good Foods from almost the majority of our competitors is how committed we are to brand building and in particular, marketing. We're spending right now about 9% of net sales. And we know that at that level of spend, we have a very strong share of voice. As we think about Atkins, and we just talked about that marketing campaign. We're investing slightly above a year ago on Atkins and with a particular heavy up focus over the first quarter. As we talked about, based on our testing results, we believe the creative will perform more strongly, and we're focused on additional reach, taking our reach from 69% to 86%. And then in the back half of the year, we're going to be making a significant investment in cost advertising, which really hasn't had a lot of focus to date. So we'll be bringing out a new campaign, a reach-based media campaign behind that. So we are the market leaders. We fundamentally believe in brand building, and we believe that separates our company and our brands from our competitors.

Our next question comes from the line of Jason English with Goldman Sachs. Please proceed with your question.

A couple of questions. First, some tactical questions. You highlighted some new club product for Atkins. Is this designed for your existing customers? Or is any of this an opportunity to penetrate new customers. And then on Quest, you referenced partnering with retailers who view Quest as a pioneer, nutrition snacking category. Part of your retailers seems like it's par for the course. It sounds like this is probably not like the fact you're calling it out suggests this may be something over and above partnership. Can you expand and give us a little more detail and color on that initiative?

Yes, happy to, Jason. As it relates to the Atkins club program, we have moved from offering a variety pack to a straight pack and what we've learned from our own research, there's a significant opportunity if we can hit a specific price point, which we have. We believe that effort will resonate both with existing consumers as well as bring in new consumers. So that's the goal there. With respect to your second question on Quest, yes, you're right. this category, and I've talked about it before, I describe it as a teenager compared to the majority of senior store categories. You've got the twin tailwinds of snacking and health and wellness. It over indexes with millennials and Gen Z. And the reason I refer to it as a teenager, 50% household penetration versus 90% for most in the store categories. And a real, as you know, a bright spot in the same store. And retailers see that. I believe the category could double over the next 5 to 7 years, I don't know exactly when, but that's the potential, retailers see that. I've met with all of them, many multiple times since joining the company. We're also a category adviser to the majority of our customers. So one of the things I focused on in my first 6 months is developing multiyear partnerships with retailers to provide and build additional space and additional focus on this category. So moving from perhaps more of a transactional approach to category leadership to a longer term, more strategic approach where we're building plans together to double down on this category, how do we add more space? How do we bring -- how do we have additional merchandising opportunities et cetera, et cetera. Obviously, e-commerce the only -- a big focus there. And within that, innovation plays a critical role. And as you know, our retailers view Quest is the innovation pioneer in the category. So you're right to highlight it, Jason. It is a stepped up next level approach to category management. that one, that will underpin what we believe will be a doubling of this category over the next 5 to 7 years.

Jason, just to add a little bit on that, too, if you take a step back in the last year, we're up 25% in consumption for Quest, right? So I mean that's a huge growth and retailers obviously see that and want to go with a winner here. So they're looking to partner with us because they see the growth potential of the brand.

And I did a poor job of asking my first question. So let me come back and ask it more directly. Are you taking these new Atkins products to Costco?

Well, as you know, we're not in Costco. We see it as an opportunity. It would represent a significant increase in the business, which would be incremental but of course, we have to find a proposition that works for us and for Costco but you can probably bet that we're having ongoing conversations with them.

Our next question comes from the line of Pamela Kaufman with Morgan Stanley. Please proceed with your question.

Can you talk about how you're thinking about the cadence of top line growth throughout fiscal '24? And maybe elaborate on how you're thinking about the growth outlook by brand. And just what are you expecting from the contribution from the 53rd week?

Okay. A lot in there. So let me take a step back and let's talk about the year first, and then I'll talk about the quarter a little bit. So on a 52-week basis, we expect total SMPL sales increase in the midpoint of our long-term net sales growth to 4% to 6%, right? That's all volume. We have no price in there for next year. Within that, we expect Quest to be growing at least low double digits for the year with some slight declines in Atkins. We're seeing the benefits of the Atkins revitalization plan. We expect POS to improve during the year with the consumption in the second half of the year better than first half. And I think that just speaks to the overall strength of the business as well as the underlying health of the category. So as related to the 53rd week, we simply added in point of growth here as we had in our plan, we talked about last time. As we finalized our plan will be in a basically did was the average of last 3 year for the first week in September to forecast the extra week. That's a little bit more than a point of growth, you can't just take 1 divided by 52 to estimate that because we have a fall resets to be shipped in August, we don't replenish that until mid-September. So it's pretty early getting into the 53rd week, but we should plan on about a point of benefit there to more or less depending on timing of shipments. So that kind of focuses on the year and the split of the -- by the brands. As it relates to the flow during the year, retail takeaway should be somewhat similar by quarter, say, high to…

I also just wanted to dig into a bit more on how you plan to capitalize on the growth in GLP-1 drugs. What were the findings of the study that you conducted? And how are you thinking about the role that each Atkins and Quest can play in targeting this consumer?

We believe, based on our research, which I'll talk about the GLP-1 drug pirate significant tailwind for both businesses. Over the past 3 months, we conducted a lot of proprietary research with consumers on the drug to understand the impact they were having. What we saw is, yes, there's a reduced appetite but it's especially focused on less healthy products. And what we found is that consumers on the drugs were eating and seeking smaller healthy meals and snacks, especially high protein products because they still need to get nutrition they need. So through our research, what we found for both Atkins and Quest opportunities, for these brands to be an excellent companion when consumers are on the product. And our research found that by far the majority of consumers taking the drugs don't plan to stay on. So they still want to hold on to the gains and what we found in our research is our products are an excellent off-ramp as well. So we see this as significant long-term opportunity. We're clearly still in the early innings of these drugs and their adoption. But we wanted to get a jump start on it. We've worked with several external partners to build sizable, addressable audience of consumers who are either interested in or on the drug and we plan to deliver them targeted communication, brand messaging, offers, et cetera, again, about how our products can be a perfect companion when you're on the drug and off-ramp. Again, we're still in the early innings of the campaign that we will bring to market or deploy in the next quarter but we see this as a long-term potential. And as advocates of weight wellness, we think it's terrific that consumers have another tool in their arsenal. And it's just going to bring additional focus to weight loss, particularly on Atkins, which is where the brand plays.

Maybe if I could just sneak in one more. So you don't [Indiscernible]

[Indiscernible] go back in the queue.

Okay. I'll go back in the queue.

Our next question comes from the line of Matt Smith with Stifel. Please proceed with your question.

Geoff, if I could ask you, a number of years ago, the Atkins brand, you talked about high loyalty rates and the annual buy rates for existing consumers really being a tailwind to the brand. How do you think about the development of the overall category and the prevalence of new brands and the impact that would have on Atkins as we stand here today? Do those metrics naturally move lower over time, but the growth potential and the size of the category are larger today and therefore, it may not be a negative to the brand? Or do you expect to get back to those high loyalty and repeat rates?

As I said in the remarks, since coming on to the business, dived very deep on Atkins, a lot of research with consumers, a lot of analytics on the business. And that research to me just reaffirmed the opportunity this business has. It is so uniquely positioned against an opportunity that is significant. As I said, 80% of consumers want to lose or maintain weight and Atkins is seen as a trusted leader in low-carb low-sugar solutions. So the long-term potential of this business is significant. What I talked about was we had some executional missteps that have impacted some of those metrics by rate, for example. When you're not bringing really great innovation, when you've got an executional miss-step with a large club customer, that's going to show up in those numbers. But fundamentally, when we fix those and those fixes are in market, and when we continue to support the business with marketing, focused on talking to core users as well as some of the skeptics, we believe these metrics will start to turn around. And then you have, to the last question, the additional interest in weight management that is just going to drive additional interest in those brands. So the slight decline we're seeing in some of those metrics right now. You've got to look at those and say, a big driver of the impact we're seeing as a commercial miss-step. We're fixing it. We're committed to the long-term growth of this business. Which is why we're doubling down, increasing marketing, bringing new innovation to market, working on packaging, and those metrics, very confident we'll start to turn very quickly in the right direction.

Just a quick add on there, Matt, if you take a step back, the Atkins consumer has been a very loyal consumer over the years. We've seen that through the modeling that we've done. We have mentioned before, we've seen a slight decrease in buy rate over the last x period of time, principally because of probably the pricing aspect of that thing. But the buy rate on retained users continues to be very strong. So we'll see that get better, as Geoff said, with all the things we're doing in the market, but I think it continues to be a strength of the brand.

Our next question comes from the line of Jim Salera with Stephens Inc. Please proceed with your question.

I wanted to ask, you gave some good detail and appreciate on kind of the Atkins revitalization. When you're having these conversations with your retail partners, are there certain metrics that they want to see, whether it's from the existing Atkins on shelf presence or maybe in terms of like new product innovation for you guys to win the distribution back? And any color you could offer on that would be helpful.

I just want to -- just your last point first, our distribution is extremely strong right now. So that hasn't been an issue for us. I have been on the road. I've met with every retailer, many multiple times since joining the company. And I've had conversations about Atkins and I've been candid about some of our commercial missteps, which I think have appreciated. But those conversations have every time gone to the importance of the weight management category and how we are the clear leader in that category, and they want us to win. They are extremely aware, as I've talked about, of the size, the 80% want to lose weight, maintain weight. And this is an important job for consumers that they need to support. And they are committed to Atkins long-term health. They also -- when you talk to them -- to them, it's all about incrementality. And that's what Atkins bring to the category, particularly with this type buy rate. So in those conversations, I've laid out our 6-point plan to revitalize the brand. They're excited about it. They're giving us the time, they're giving us the support. And they know -- they look at this category in relation to the rest of the store. They see what -- how it's performing today and they see potential. We talked about doubling it over the next 5 to 7 years. And they know that Atkins is a critical component of that plan. So very, very positive conversations with retailers.

And if I could sneak a follow-up in for Shaun. High-quality problem to have, but as we look forward, you guys don't really have any need to pay down debt. You don't have any CapEx really expenditures as we're modeling the cash build, I mean, should we think of like share repo as a use of some of the excess cash you guys build? Should we just expect cash to build on the balance sheet? Does that get put back into maybe the R&D pipeline or some advertising? Just any way we can think about that moving forward?

I mean we have -- first of all, take a step back. We love our model. We love the cash it throws off. You guys know that as you look at our results overall. This year, we'll be continuing that overall. And right now, we're happy to be lower than 1 times levered. Especially when you think about the fact we were over 4 times, 4.5 times about 4 years ago with Quest, acquisition. So we have a small group that meets pretty right early to discuss capital allocation. We evaluate debt paydown, share buyback and M&A opportunities as they come up. We'll continue to do that in fiscal '24, but those are certainly the areas that we're looking for from the standpoint of use of the cash.

Our next question comes from the line of Jon Andersen with William Blair. Please proceed with your question.

I have a question on Quest. The consumption obviously remains quite strong there, running up mid-20s. I'm wondering if you could talk a little bit about the composition of that growth that you're seeing and the composition going forward. So you referenced the household penetration rate being relatively modest, I think, at 15%. When we think about that kind of mid-20s consumption, how much of that is household penetration gain? How much is buy rate among existing users? And can you talk a little bit more about your plan to maintain strong consumption in fiscal '24 on the Quest brand?

When we acquired Quest, it was primarily a bar business, I think bars are about 80% of the business. Today, bars are just a little bit over 50%. And that is because in the last few years, we have successfully launched new products and formats that have really propelled the business. For example, in fiscal '24, we anticipate our salty snack platform to be over $200 million in net sales, 25% of the Quest portfolio. But to your question, importantly, this innovation has proven to be highly incremental to the brand and very importantly, to the category. For example, 30% of new users to the brand have come from chips. But critically, why we've been growing the bar business has grown 22% year-to-date. So Quest has proven it's one of the few brands that can successfully extend across multiple product forms. I'll go a step further. Our consumers are demanding it, and our retailers are asking for it and that's the opportunity. I spent a lot of time with Quest consumers over the last 6 months. To them Quest is a lifestyle brand, it sort of brilliant hack of sorts. It's not just a product brand, and it's why they're demanding us to bring out additional formats that we're focused on. So what I would suggest is if you think about a large and perhaps growing carbohydrate, dense snack where we can flip the macros you can probably bet we're looking at it. We've seen, again, that innovation to be highly incremental, brings in new users. But very importantly, retailers see it to us bringing in new category users. And that's why we're getting the support of retailers. And then, I guess, lastly, you've talked about where we're going with the brand. Yes, we'll continue to push out on innovation. There's still distribution weight space. I think Jason made a reference to that. But the next arrow we're pulling out in Quest is marketing. It's talked about the awareness is relatively low versus most brands. There's an opportunity to drive additional witness and household penetration behind a focused and world-class marketing campaign that we'll be rolling out in the new year. So those are the 3 drivers of Quest, but I'll just underscore, this is an incremental brand driving incremental consumers.

I mean I think as you step back, if you look at the '23 growth, we've had tremendous growth. I mean, obviously, we benefited like everyone else as we go through that, which we're not going to have this year. We're really excited about the opportunity to continue to grow that brand in the mid-teens with all the growth being volume overall. So when we did the acquisition way back when one of the opportunities that we saw with distribution. We saw that build this year. We're going to continue to see that going forward. But I think the strength of that brand has been recognized by retailers and there's really a growth engine for them as I look at that category overall.

Our next question comes from the line of Rob Dickerson with Jefferies. Please proceed with your question.

I just wanted to ask, I guess, a little bit about magnitude of kind of the new marketing campaign, right? I mean, if we go back kind of historically with simply kind of as it had de-spec and part of the platform was to kind of run kind of a higher relative rate of marketing kind of brand push, right, low CapEx model, solid top line growth. If we go back even to the, I don't know, fiscal '17, '18 years, selling and marketing expenses were almost at 14% and in '23, we were sub-10%. And then I also understand over time as you can kind of recapture some of this gross margin. I would assume that the level of that marketing spend is stepping up. You're speaking to a new campaign. We have a new brand ambassador. So I'm just trying to get a sense of maybe firstly, if we think about fiscal '24, like how much should we be thinking selling or marketing would actually be up year-over-year or as a percentage of sales? And then maybe just any incremental color on kind of what material gross margin expansion kind of implies in fiscal '24?

So I think what you're asking there is just basically how much we stepping up marketing in fiscal '20 for. If you take a step back, we -- to your point, we had always tried to our model, if you will, was get about 10% marketing spend, we're probably closer to 8% of that in '23. We want to be closer to 9% a little bit north of that in '24. So we're going to see meaningful increases in marketing. We plan for mid-teen growth in marketing for fiscal '24 versus where we are today. So that's the point we have. And as Geoff said, it's on both brands. We'll probably see more of that for Atkins in the first half of the year. And then as we have the new advertising for Quest, we'll see that pop in the second half of the year. So I don't know if I answered your question or not, but that was what I think you asked.

Yes, that's good enough. And then just on gross margin, so thinking of magnitude of expansion potential in '24.

Gross margin?

Yes.

So first of all, we're pretty confident in delivering the gross margin meaningfully in fiscal '24. For the full year, we think gross margin of 38% is very attainable, driven by commodity decreases across most of our key ingredients, a couple of caveats there. First, that's based on how the world is today. Obviously, we're not 100% covered. So if something rattles the market is subject to change. You see a little bit of that with come from right now. Second, we're not going to drop all the favorability to the bottom line. We talked about that already. We're reinvesting a big piece of that back into the business. marketing will be growing in the mid-teens, both brands, and we're reinvesting some favorability back into trade for Atkins, particularly in the first half of the year as we want to make sure we stay active in the eyes of retailers and consumers until the revitalization plan kind of bears out. So I don't think it's a flavor of what we're looking for.

Our next question comes from the line of Matt McGinley with Needham & Company. Please proceed with your question.

I have a follow-up on that gross margin. Can you help frame your expectations on the cadence of gross margin improvement this year? Do you expect those gains to be more front half weighted or back half weighted and you made the mention around higher levels of marketing. I guess can you kind of tease out like what -- how much higher levels of promotion do you expect? And how much of that would be offset by the gains from input deflation in this year?

So in terms of sequential for gross margin, I think you're going to see more growth in the second half of the year than the first half of the year. Just if you take a step back, if you look at it historically, Q2 is we have lower gross margin with higher trade spend in the quarter to support New Year, New You. Additionally, we put a little more of the trade spend in Q1 of this year to really jump start the business, as I mentioned. So you're going to see gross margin improve in Q1 versus Q1 last year, should be about the same as Q4. So with Q1, it will be about the same as Q4 in terms of gross margin. And then you see pretty significant gross margin expansion in Q3 and Q4 this year. So a lot of that, as I say, back half loaded. As it relates to trade, we're up -- I mean, we're not drastically up in spend overall. We're just really trying to make sure that we support the brand in the marketplace as we get through the revitalization. So little bit of an increase there. And effectively, what we did was we typically do promotional plans with our retailers in September and in January to support the resets as well as the New Year New You, we have added some more spending in October and in February this year to support the brand a little bit more and get better growth on those time frames. So I don't if I answered your question or not, but that's direction of what we're doing.

Ladies and gentlemen, our final question this morning comes from the line of Stephen Powers with Deutsche Bank. Please proceed with your question.

I guess just listening to the Atkins conversation throughout the call. I think it comes across as you've got a pretty clear view of what the deficiencies have been and a pretty clear vision of needs to be done. I guess the question I'm left with, is there anything, Geoff, as you've gone through the review of that brand that you -- are there open questions that you still have? Are there things that you still don't know that you'd like to know to have just even a higher degree of confidence on the overall revitalization.

That's a fair question. I mean, no, I have a lot of confidence in the plan that we've developed, which is based on what was very comprehensive research on the business, talking to consumers, advanced analytics, et cetera. So there's a tremendous amount of confidence we have in the plan. We know that the opportunities in front of us are to, in the near term, accelerate our innovation to market but ensure we build a multiyear pipeline. We've identified opportunities to upgrade the product and hopefully deliver superior shelf life. We're focused in on specific customers. We've talked a lot about the club channel, which is an opportunity, that fix is already shipping to market. We've talked about doubling down on e-commerce. And then a little more long term, how do we modernize the brand how do we enhance the brand experience. You've seen us go out initially with new advertising supported by expanded reach. We've got a packaging refresh coming, which I'm sure you'll understand takes a little longer. The series of initiatives we have will come to market sequentially over the next 12 to 18 months. And then we also have the weight management drug which our research strongly shows this is a tailwind for the business. But that's in the early innings. So as we think about Atkins, we have a goal to stabilize the brand and then by the back half of our fiscal, you'll start to see improvement. And then underpinning it all, I put a new leadership team in place. to drive enhanced accountability and execution. So I have a tremendous amount of confidence and then it's all wrapped up in the opportunity. This brand is so sharply positioned against a need that is only growing and it's our job to ensure we can deliver its full potential. So a lot of confidence.

I just want to thank everyone for the participating on today's call. We look forward to updating you on our first quarter results in January. So I hope everybody has a good day.

Thank you.

Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.